Keeping Employees Highly Motivated at SAA, Essay Example

Part 1, Questions 1-4: SAS provides software solutions to a large number of companies for uses such as performance measurement, risk management, relationship management with both customers and vendors, and detecting fraud. As the CEO of SAS, Jim Goodnight presides over the largest privately held software company in the world. Being in the most powerful position in a company that is also not publicly traded provides Mr. Goodnight vast opportunities to make meaningful changes and implement programs that help him solve the company’s challenges.

Part 1, Question 5: Through his actions and activities, it is clear that Mr. Goodnight understands the importance of having a highly motivated workforce. The key to his challenge is to maintain this high motivation level. In order to continue to succeed in this effort, SAS needs to fully understand what drives motivation and how to successfully obtain it for the workforce. It is important to understand that not every employee will be motivated in the same manner, although there are many theories and methods that can be utilized to ensure that motivation is created.

It is also important to understand the strengths of an organization when facing a challenge. For SAS, that strength is the fact that not only is there every indication that they currently have a motivated workforce, but they have also been recognized for it after being listed by Forbes Magazine as one of the best companies to work for 13 years in a row. Such recognition has also generated many published articles on their approach to employee motivation and the opportunities to create the right atmosphere for their company.

Part 1, Question 6: Annual turnover rates in the software industry is around 22%, so it is critical that Mr. Goodnight understand the nature of what motivates his employees in order to keep his employees. Motivation can come from a variety of needs and sources, and these variables will be different for each individual. The most effective approach would most likely be to provide a variety of different motivational factors. We know that encouraging both intrinsically and extrinsically motivated behavior can be effective. For example, most employees will exhibit an intrinsic characteristic of pride of work, and they will have a sense of accomplishment by performing their work well. Another intrinsic example would be to ensure employees love the kind of work they are doing, as this by itself can lead to great levels of job satisfaction and productivity. Extrinsic characteristics are more focused on rewards or to avoid punishment. A good example of this behavior would be an employee who tries to do a good job to maintain job security.

Another extrinsically motivated behavior would be the expectation that rewards are given to employees that perform well. Expectancy theory illustrates this, as the theory posits that when workers believe that high performance will lead to higher rewards, this will increase their motivation and productivity. This is considered one of the most popular theories of work motivation as it is broad in how it appeals to employees and companies.

Need theories are also important to understand in order to have the information required to satisfy the challenge for SAS. Need theories address the understanding of what motivates employees beyond extrinsically and intrinsically motivated behaviors. These theories call for understanding of what needs each individual employee possesses, as the motivational level achieved will be based on how well such needs are able to be met by the company. There are many need theories that can be examined, such as Maslow’s hierarchy of needs, Alderfer’s ERG theory, Herzberg’s motivator-hygiene theory, and McClelland’s needs for achievement, affiliation, and power. Needs to be addressed can include achievement, power, life balance, nature/environment, growth, esteem, among others.

A sense of fairness is at the heart of equity theory, which describes how motivation is influenced by a comparison of how performance is found to be rewarding versus an absolute measurement. For example, how other employees in similar positions are evaluated or rewarded would have a direct impact on another employee’s motivational level through this theory. This theory motivates employees to maintain current levels of performance in order to gain current levels of rewards. If they wish to increase their outcomes, this would increase their inputs, or reward level. In direct contrast to equity would be inequity, which motivates employees to seek equity when it exists.

Similar and complementary to expectancy and equity theory is goal setting theory, which contributes to motivation by considering how managers focus the efforts of performance in order to achieve important company goals. High motivation would be achieved by setting specific and difficult to reach goals, as if they are too easy and most can achieve them they lack the same potential for motivation.  This theory also provide the added benefit of allowing the manager to focus efforts in a specific area that provides the most benefit to the company, so they attain more control on where individual employees perform.

Another type of theory to consider are learning theories, which comes through learned experiences and performance that links to previous efforts on behalf of the organization.

Through this effort employees can be enriched through learning of new skills and behaviors that in turn can benefit the company. Examples of useful learning theories would include operant conditioning theory and social learning theory.

Part 1, Question 7: The fact that James Goodnight did solve this challenge would be hard to dispute, given the recognition he has received for his company. For intrinsic considerations, SAS employees can take great pride in their work. Over ninety of top one hundred companies on the Fortune Global 500 use SAS software. The company also offers them a program that allows them to change the type of work they do at the company. This ensures that employees do not lose interest if they have being doing a certain job for a period of time and decide they wish to do something different, which reinforces learning theory. For extrinsically motivated behavior, SAS employees are rewarded for good performance on the job, and equity theory is demonstrated here as managers at SAS are fair and equitable in their rewards.

Where SAS may have succeeded most prominently is in need theory, as this is a company that shoes dedication and commitment when it comes to caring for its employees. This focus for SAS has created a great deal of positive publicity for the company, and it has also nurtured a strong sense of loyalty from its employees, as shown by its incredibly low employee turnover rate of about 2%. SAS subsidizes two child care centers on its corporate campus. For those that need day care, this is a huge benefit as it allows them to keep their children close by. Other amenities include a fitness and recreation center with a Olympic size pool, dry cleaning, car detailing, wellness programs and work-life centers. The average work week is 35 hours for these employees, with few requirements for overtime. Employees also have job security, and it is very notable that SAS laid off no workers during the economic downturn that began in 2007.

Of all of the benefits SAS employees receive, the on campus health care center may be the most popular. With a staff of 56 physicians, nurses, physical therapists, lab technicians, and psychologists on hand, this center provided for the needs of about 90% of the employees at SAS headquarters that scheduled over 40,000 appointments in 2009. In addition to convenience, this facility avoids loss of time of work for employees and saves both the company and its workers a great deal of investment.

Part 1, Question 8: Although you could argue that Mr. Goodnight has shown all of the four managerial tasks, leading is the one that he has shown most strongly. As SAS is a privately held company that he co-founded, Mr. Goodnight has a very strong influence on the entire company, how it has grown, and its culture. The fact that employee motivation appears to be high by any measure of the company is a strong sign of good leadership qualities. Many of the things that SAS does are not found at many other companies, and when companies like Google use SAS to develop their own employee benefit program then it is obvious that Mr. Goodnight has created something very unique and special at his company.

Part 2, Question 1: The four articles are as follows: 1. David A. Kaplan, “SAS: A new no. 1 best employer”. This article is from CNN.com, dated January 22, 2010. 2. Charles F. Fish, “Sanity Inc”. This article is from Fast Company dated December 31, 1998. 3. Steve Lohr, “At a Software Powerhouse, the Good Life is Under Siege”. This article is from The New York Times dated Nov. 21, 2009. 4. Matt Wilson, “SAS’ Internal Social Network Attracts 5,000 Users in Just Weeks.” This article is from Ragan.com dated March 9, 2011  Part 2, Question 2: From the perspective of multiple articles, SAS has succeeded in creating a highly motivated workforce. The articles contain many quotes from employees and Mr. Goodnight describing how SAS has created something unique that benefits both the company and its workers. The statistics are very impressive. The average employee works ten years at SAS, and 300 have worked for them 25 years or more (Kaplan). Additionally, never in the history of the company has the annual employee turnover rate exceeded 5% (Fishman). What makes this more impressive is how volatile employment is in this kind of industry. This has been accomplished even though SAS does not pay high in the field, and there are no stock options (Kaplan). This demonstrates that employees are not just motivated by money, but they are motivated by how they are treated.

Their reputation also helps them obtain high quality, desirable workers. In 2009, SAS hired 264 employees, and they received 100 resumes per opening (Kaplan). SAS can be very selective in who they hire for each position that comes open because people are so eager to work for them. This is especially important given that SAS faces increased competition. Companies such as IBM, Microsoft, and Oracle have recently invested billions to compete with SAS for business intelligence software (Lohr).

In addition to the employee benefits related in the text, articles describe the on-site workday sports leagues that play during lunch hours (Kaplan). SAS has also developed an internal social network like Facebook that attracted 5,000 new users in the first three weeks it was operating (Wilson). These are examples of a different way that SAS encourages team building, and it also applies to health and wellness by giving the employees a fun way to stay active during their work week, and to establish bonds between co-workers.

Part 2, Question 3: This article about SAS was a great lesson for me in leadership and the importance of motivation in the workplace. By describing all of the programs and efforts that Mr. Goodnight and SAS make to take care of their employees, I learned about all of the issues that could make employees less motivated, and less productive. I also understand that what SAS did is good business, as they are clearly a very successful company whose employees make products that the largest and most successful companies in the world want to use.

When reading the text, I realized that SAS has employed all of the theories the text described in one form or another. It is impressive how much effort that they have placed into their employee programs, and it makes me realize that in order to properly care for the workers, a company has to be diverse and implement many programs to meet the need of every individual. This is because every individual has different priorities and different needs.

Works Cited

Fish, Charles F. “Sanity Inc.” Fast Company. 31 Dec. 1998 <http://www.fastcompany.com/36173/sanity-inc>

Kaplan, David A. “SAS: A new no. 1 best employer.” CNN.com. 22 Jan. 2010 <http://money.cnn.com/2010/01/21/technology/sas_best_companies.fortune/>.

Lohr, Steve “At a Software Powerhouse, the Good Life is Under Siege.” The New York Times. 21 Nov. 2009 <http://www.nytimes.com/2009/11/22/business/22sas.html?pagewanted=all>

Wilson, Matt “SAS’ Internal Social Network Attracts 5,000 Users in Just Weeks.” Ragan.com. 9 Mar. 2011 <http://www.ragan.com/InternalCommunications/Articles_SAS_internal_social_network_attracts_ 5000_users_ in_42751.aspx>